Correlation Between Heska and LENSAR
Can any of the company-specific risk be diversified away by investing in both Heska and LENSAR at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Heska and LENSAR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Heska and LENSAR Inc, you can compare the effects of market volatilities on Heska and LENSAR and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Heska with a short position of LENSAR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heska and LENSAR.
Diversification Opportunities for Heska and LENSAR
Very weak diversification
The 3 months correlation between Heska and LENSAR is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Heska and LENSAR Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LENSAR Inc and Heska is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Heska are associated (or correlated) with LENSAR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LENSAR Inc has no effect on the direction of Heska i.e., Heska and LENSAR go up and down completely randomly.
Pair Corralation between Heska and LENSAR
Given the investment horizon of 90 days Heska is expected to generate 36.72 times less return on investment than LENSAR. But when comparing it to its historical volatility, Heska is 266.61 times less risky than LENSAR. It trades about 0.45 of its potential returns per unit of risk. LENSAR Inc is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 381.00 in LENSAR Inc on August 31, 2024 and sell it today you would earn a total of 372.00 from holding LENSAR Inc or generate 97.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 1.34% |
| Values | Daily Returns |
Heska vs. LENSAR Inc
Performance |
| Timeline |
| Heska |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| LENSAR Inc |
Heska and LENSAR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heska and LENSAR
The main advantage of trading using opposite Heska and LENSAR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heska position performs unexpectedly, LENSAR can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in LENSAR will offset losses from the drop in LENSAR's long position.The idea behind Heska and LENSAR Inc pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| LENSAR vs. Abbott Laboratories | LENSAR vs. Medtronic PLC | LENSAR vs. Edwards Lifesciences Corp | LENSAR vs. ZimVie Inc |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
Other Complementary Tools
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device |